A MESSAGE FROM OUR MANAGING DIRECTOR
It might be surprising that there were as many similarities as there were differences in our Australian July 2022 results compared to those 12 months earlier .
Some of the important numbers were remarkably similar . Our total value of sales in Australia in July was $ 4.6 billion , down three per cent on the prior year . We also listed a very similar number of properties , with 5,800 new listings for July compared to 5,600 in July last year . And there were 2,607 auctions scheduled in July , a slight drop from 2,681 .
The differences in the market compared to last year was best evidenced in bidder numbers and total stock on market . A year ago we averaged 3.7 active bidders per auction , whereas this July we averaged 2.3 active bidders . While new stock to market is similar to last year , total stock on market has increased by over 30 per cent . However , both bidder numbers and stock levels are in line with longer term averages .
It ’ s become more dangerous to make generalised comments about the Australian market . There ’ s clearly more momentum in South Australia , Western Australia and most of Queensland , than there is in New South Wales and Victoria . However , we ’ re broadly seeing that buyer urgency has tempered , more strongly in some areas . Increasing stock on market gives them more choice and confidence to be patient . And as most economic commentary points to risks in the economy , what ’ s absent is the fear of missing out .
History teaches us that when market changes like this , vendors and many agents will be reluctant to invest in marketing and commit to auctions . This is a natural defensive reaction , as marketing and auctions requires full investment in the sale process at a time when many are saying the market is more challenging .
But we know that this is precisely the time when both of these things are so critical to get the best result . They are the best way for us to create competition between buyers , and with no competition there will be no urgency from buyers .
Our sales results show us that there are still many buyers in the market and they ’ re happy to pay market price . But they ’ re paranoid about overpaying - and nothing gives them more confidence to buy than seeing other bidders in action . And we ’ re seeing this in our data - those vendors that use the auction method of sale have about a 60 per cent chance of selling their property in 45 days , yet only have a 40 per cent chance if they sell by private treaty .
What July showed us once again was that there ’ s plenty of activity in the market provided that buyer competition is created , and they ’ re given the confidence to bid in an open and transparent manner .
Dan White Managing Director Ray White Group
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